Beijing authorities have launched an investigation into possible trademark infringement by Apple after a Chinese company filed a lawsuit against the electronics giant for infringing upon its trademark of the iPad name, which may result in Apple receiving a heavy fine.
According to the Beijing Evening News, the Xicheng District Administration for Industry and Commerce has investigated the case, as it is the district where one of the five Apple stores in China is located.
Apple has been denied the rights to the trademark for the term "iPad" in China, after a legal battle with Hong Kong-based Proview Technology. Proview registered the iPad trademark in markets as early as 2000, long before Apple unveiled the iPad in 2006.
Lawyers representing Proview confirmed with the Global Times that they have urged the administration several times to make a final decision about Apple's penalty.
"Proview made a formal complaint to the Xicheng administration in 2011 and they had planned to slap Apple with a 240 million yuan ($38 million) fine, but it was suspended after Apple's objections," said Xie Xianghui, a lawyer from the Shenzhen branch of Grandall Law Firm.
According to Xie, besides requesting related government departments investigate Apple's trademark infringement, they have also filed lawsuits against Apple's authorized retailers and stores in local courts.
Proview plans to ask for 10 billion yuan in compensation from Apple, said Xie.
However, the Xicheng district administration said they had never announced the possibility of a 240 million yuan fine for Apple. "It is still under investigation, so no official comments on the case can be made yet," a media officer at the publicity office of the administration told the Global Times.
Apple filed the appeal on January 5 with the Higher People's Court of Guangdong Province, after the Shenzhen Intermediate People's Court rejected Apple's claim to assert its control over the iPad trademark in China, National Business Daily reported.
In its lawsuit, Apple claimed that a Proview subsidiary in Taiwan had sold the iPad trademark rights to a UK-based company called "IP Applications," which then sold the trademark to Apple in 2010.
Xiao Caiyuan, another lawyer representing Proview from Shenzhen-based GH Law Firm, told the Global Times that although Apple has appealed the court's ruling, it would probably lose the appeal again based on existing facts.
"We have prepared well for a long-term legal battle," Xiao said.
However, some people pointed out that Proview is trapped in a debt crisis, and is trying to use this case to get out of its financial troubles, according to the Xiamen Economic Daily.
Lawyers representing Apple could not be reached by the press time Monday.